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Enron Mail |
The Brazilian arbitration statute is only four years old, so arbitration is
still somewhat of a new concept. However, businesspeople in the more sophisticated commercial centers (Sao Paulo and Rio) are comfortable with it, as are those companies that have been involved in international projects, are subsidiaries of multi-national companies, or that have relied on offshore financing. Governmental and quasi-governmental entities, including utilities, have been resistant to it, in part because there is language in the Brazilian Constituition that could be interpreted to forbid waiving resort to the courts where natural resources ("patrimonial rights") are involved. I think where we will get pushback on this policy is with respect to the language of the arbitration and the ICC. For that reason, I suggest we go ahead and "pre-qualify" the acceptance of Portugese for contacts where less than $5 million is involved, and the acceptance of alternative arbitral bodies (the Canadian Chamber of Commerce and perhaps FIESP) where less than $3 million is involved. -----Original Message----- From: Haedicke, Mark Sent: Tuesday, April 03, 2001 10:50 AM To: Williams, Robert C. Subject: RE: Brazil Arbitration Bob: What is the view in general re arbitration of Brazilian companies? Should we expect many objections to our new policy? Don't get many objections in the US. Mark Robert C Williams/ENRON@enronXgate 04/02/2001 06:11 PM To: Michelle Blaine/ENRON@enronXgate, John Novak/SA/Enron@Enron cc: Richard B Sanders/HOU/ECT@ECT, Rob Walls/ENRON@enronXgate, Mark E Haedicke/HOU/ECT@ECT Subject: RE: Brazil Arbitration Michelle, I did not speak with Jim or Rob about this, so I am assuming that you did. I think it is a good policy, although I am still not as convinced as Sami is that the courts in Brazil will so cavalierly disregard international arbitration provisions. Nevertheless, I think it was necessary to change our policy from a commercial perspective; we were getting too much resistance to foreign arbitration. Now the question is, do we go the next step and see if Jim will approve submitting to the jurisdiction of some courts in Brazil which are generally reliable and free of corruption (e.g., Sao Paulo and Rio) if the counterparty rejects arbitration, and the largest sum of money that would ever be in dispute would be less than $500,000? I think we will face that soon, so we may as well raise it now. -----Original Message----- From: Blaine, Michelle Sent: Monday, April 02, 2001 4:41 PM To: Novak, John; Arap, Sami; Watanabe, Luiz; Kishkill, Joe; Wiggs, Brett; Albuquerque, Joao Carlos; Rosenberg, David; Collonges, Remi Cc: Sanders, Richard; Williams, Robert C.; Walls, Rob; Haedicke, Mark Subject: FW: Brazil Arbitration FROM: MARK HAEDICKE & MICHELLE BLAINE Effective immediately, trading contracts to be performed in Brazil between a Brazilian Enron entity and another Brazilian entity, may contain agreements for arbitration in Sao Paulo using the ICC administration and rules, to be conducted in the English language as a first choice or English & Portuguese as a second choice. Attached is the rationale for this exception to the policy favoring foreign arbitration and a model clause. Legal will continue to monitor how the Brazilian courts react to arbitration both foreign and domestic and reevaluate the policy in 2002. Please call Michelle Blaine if you have any questions. << File: Arbitration Agreement Terms for Enron-Brazil Agreements.doc << << File: Enron-Brazilian Model Arbitration Clause.doc <<
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